Before I post the excerpt of the article, just wish to point out that I cannot find it from The Star's link. Very strange indeed. Is it being blocked?
The following is from another site, Transitmy, which commented on it...
'Why we should look for cheaper alternatives before embarking on an expensive rail link to Singapore
Link
The following is from another site, Transitmy, which commented on it...
'Why we should look for cheaper alternatives before embarking on an expensive rail link to Singapore
STRANGELY, one reason given for a high-speed rail link between Malaysia and Singapore is that it will increase property values in Kuala Lumpur.
The way it is phrased is interesting, “unlock property values in Kuala Lumpur.” Tell me, who locked property values in Kuala Lumpur in the first place? Perhaps that is key to understanding this convoluted logic.
I can understand that it reduces travel time between Kuala Lumpur and Singapore considerably – by land that is. I can see how it might – might – improve tourist arrivals here, though I don’t see why the ingresses into Malaysia right now are insufficient.
Thailand and Indonesia don’t have high-speed rail links to anywhere but that has not stopped a burgeoning in their tourist arrivals. In fact, the easiest access to these countries continues to be by air. Lack of rail links has certainly not hampered Bali, for instance – the planes make a beeline to it.
The Government through one of its agencies, the Public Land Transport Commission, expects to finish a feasibility study in eight weeks. But let’s do a back-of-the-envelop, quick feasibility study here, which may take, oh, about eight minutes.
The cost, we presume before land acquisition and rolling stock (trains to you and me), is expected be RM8bil–RM14bil. Let’s take the upper end, because by the time all approvals are obtained, that’s how much it will cost and add to it a further RM6bil as land acquisition and contingency costs.
That brings the figure up to a nice neat RM20bil. And let’s say we need a return on this of 10% a year. That means a net profit of RM2bil a year, a huge amount which only a handful of public-listed companies achieve. And let’s say that takes a revenue of 10 times that or RM20bil a year!
That RM20bil is less than the entire revenue of both AirAsia and Malaysia Airlines in a year, implying that we will not in the near future get anywhere near the revenue required to make this rail link profitable on a standalone basis.
Conclusion: It is not commercially viable.'
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